So you are thinking about starting a small business? There are many things to consider. What will you call the business? Will you incorporate as an LLC, a partnership or a corporation? What is your value proposition? Will you need employees? How many?
There’s a lot to consider and although this article can’t possible cover all the issues—there are scores of books written on this topic—we’ve turned to our experts for insight into some of the most important things to consider before starting your business.
- Do you have the resources?
You may have a bright idea, but do you have the resources to launch it out? John Turner, founder and CEO of UsersThink, a tool that delivers feedback on demand for website landing pages, says this is a key issue to consider before you get too far down the road.
“Having resources might be having enough cash to build what you need, or to cover your basic expenses as you work on it—or, if you’re still working, having enough time,” Turner says. “It could also mean having right connections to mine for initial traction.”
Turner’s advice: Spend at least a little time mapping out the resources you will or may need to get the business going. That, he says, will help determine the best strategy for entering the market or help you determine you aren’t ready to launch quite yet.
- One “do” and one “don’t
Greg Chambers, founder of the sales-and-marketing consultancy Chambers Pivot Industries, offers two things to consider in the small business launch picture. One is an absolute must and the other an absolute must not.
“Talk to more target customers than you think is possible, listening deeply to what they think about your product or service and what pains and gains they think you will help them with,” Chambers says. “Before you jump off the deck into the deep waters of small business ownership, talking to as many potential customers as you can and then doubling that effort pays off immediately in saved time and effort.”
The must not? Don’t skimp on investing in an attorney with a strong small business background. Chambers admits that most attorneys are so risk averse that you’ll leave their office filled with more doubts than you enter with, but that’s their job.
“Most aspiring business owners are great at assessing their non-negotiables versus their wants, but risk is often ignored or downplayed,” Chambers says. “A great lawyer will make you keenly aware of the risk, and you can determine if it’s acceptable.”
If an attorney can’t talk you out of your idea and you have the time and resources to execute your business plan, it’s time to get to the marketing considerations.
“What you need to consider before you start a business is how you will be marketing your business so you have all your assets in place upon launch,” says Lorrie Thomas Ross, CEO of Web Marketing Therapy. “Who are your target customers? What is your value proposition—why you versus the competition? How will you get the word out?”
If this overwhelms you, consider Ross’ advice: a marketing plan—online and offline—doesn’t need to be a novel. Still, there needs to be a plan addressing these issues so time and money are planned.
- The SBA’s 10-Step Process
The Small Business Administration (SBA) offers a 10-step guideline to starting a small business, which involves planning, making financial decisions and various other activities. Those steps are: write a business plan; get business assistance and training; choose a business location; finance your business; determine the legal structure of your business; register a business name; get a tax identification number; register for state and local taxes; obtain business license and permits; and understand employer responsibilities.
The SBA offers a wealth of information for entrepreneurs looking to start a small business. You can visit the organization online at www.sba.gov.
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